Paul Waine wrote: ↑Fri Jun 02, 2023 6:01 pm
Hi aggi, I've checked through the text of FRS 102 (current version).
Para 33.4 states: In the context of this FRS, the following are not related parties:
(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.
We know that Mike Garlick is a Director of BFCHL. We also know that Mike Garlick is a Director of Clarets Go Large.
My reading of 33.4 (a) is that this is a clear statement that Clarets Go Large is not a related party for the purposes of Related Party disclosures by BFCHL. Thus no requirement for BFCHL to disclose Clarets Go Large as the provider of loan finance to BFCHL if that is where the loan has come from.
I've not been involved in preparing financial statements for almost 2 decades. When I had to do this I was always using either IFRS or US GAAP. I've no idea whether FRS 102 has always included 33.4 (a) in the current form or whether it has been changed in recent years. It's very likely that my earlier post about 2019 changes may be a mis-reading of commentary I read yesterday.
Of course, if you (or any other poster on here) has better information on FRS 102 and Related Party disclosures, including para 33.4 (a) I'm happy to hear it.
PS: Yes, I'm a retired accountant. I've retained the right to consult ICAEW resources in retirement.
Ah, so a different exemption than the non-market rate one (which I'm pretty sure is only small companies).
Non-accountants look away now, this is going to be dull.
I think the bit you're missing from your exemption is that Garlick isn't just a director of Clarets Go Large, he is also in control. This means 33.2(b)(vi) applies. Unless of course Garlick doesn't qualify as a related person under 33.2(a)
33.2 A related party is a person or entity that is related to the entity that is preparing its
financial statements (the reporting entity).
(a) A person or a close member of that person’s family is related to a reporting
entity if that person:
(i) has control or joint control over the reporting entity;
(ii) has significant influence over the reporting entity; or
(iii) is a member of the key management personnel of the reporting entity or
of a parent of the reporting entity.
(b) An entity is related to a reporting entity if any of the following conditions apply:
(i) the entity and the reporting entity are members of the same group (which
means that each parent, subsidiary and fellow subsidiary is related to the
others).
(ii) one entity is an associate or joint venture of the other entity (or an
associate or joint venture of a member of a group of which the other entity
is a member).
(iii) both entities are joint ventures of the same third party.
(iv) one entity is a joint venture of a third entity and the other entity is an
associate of the third entity.
(v) the entity is a post-employment benefit plan for the benefit of
employees of either the reporting entity or an entity related to the
reporting entity. If the reporting entity is itself such a plan, the sponsoring
employers are also related to the reporting entity.
(vi) the entity is controlled or jointly controlled by a person identified in (a).
(vii) a person identified in (a)(i) has significant influence over the entity or is a
member of the key management personnel of the entity (or of a parent of
the entity).
(viii) the entity, or any member of a group of which it is a part, provides key
management personnel services to the
But this is the kind of thing I'd normally refer to our technical department to be honest.